Foreign investors housing ban extended

The federal government will extend its ban on foreign investors purchasing existing homes until mid 2029 as part of a sweeping housing and tax reform package aimed at improving affordability and lifting home ownership.

Announced in tonight's 2026 to 2027 Federal Budget, the measures form part of what the government described as its most significant housing intervention to date, combining tax reform, infrastructure spending and supply side incentives.in

"We will replace the 50% capital gains tax discount with inflation-adjusted indexation from 1 July 2027, to restore the taxation of real gains, and introduce a minimum tax rate of 30% on realised gains," Chalmers said.

"This will apply to all assets except new homes, where both new and old arrangements will be available. It will be prospective, with gains accrued on existing investments prior to the start date to retain the 50% discount."

The government said the reforms are expected to help around 75,000 Australians enter the housing market over the next decade, while also redirecting investment toward new housing supply rather than established dwellings.

Foreign investors will continue to be prohibited from buying established homes, with limited exemptions remaining for purchases that directly support housing supply.

Alongside the tax measures, the government unveiled a new $2 billion Local Infrastructure Fund to help finance critical enabling infrastructure.

The Local Infrastructure Fund aims to support up to 65,000 homes over 10 years.

"This $2 billion investment brings our total investment in housing enabling infrastructure to a record $6.3 billion since coming to government," Chalmers said.

"And we have a further $5.9 billion available to states and territories as part of the 100,000 Homes for First Home Buyers program."

Moreover, the government is also investing in workforce capacity, including $85.2 million to accelerate skills assessments for migrant trade workers as housing construction labour shortages continue to constrain delivery targets. Combined, the measures lift the governments total housing commitment to a record of over $47 billion.